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爱奇艺(IQ):暑期档内容热播或带动核心业务边际改善,新规释放长期想象空间

Investment Rating - The report maintains a "Buy" rating for the company, with a target price raised to $2.90 from $2.10, indicating a potential upside of 26.1% from the current price of $2.30 [1][2][4]. Core Insights - The report highlights expectations for marginal improvement in core business driven by popular summer content, steady progress in micro-dramas, IP consumer products, offline parks, and overseas business expansion, which may contribute to incremental commercialization [2]. - Regulatory changes in broadcasting are anticipated to foster long-term content innovation and efficiency improvements, leading to increased market investment enthusiasm and a higher valuation baseline [2]. Financial Forecast Changes - Revenue projections for 2025 have been adjusted to RMB 27,264 million, a decrease of 2% from previous estimates, with further slight declines expected in 2026 and 2027 [3]. - Paid membership revenue is expected to increase by 1% in 2025, with a more significant growth forecast of 4% in both 2026 and 2027 [3]. - Online advertising revenue is projected to decline by 2% in 2025, with further decreases in subsequent years [3]. - The adjusted operating profit for 2025 is forecasted at RMB 947 million, reflecting a 24% decrease from prior estimates, with a gradual recovery expected in the following years [3]. Business Overview - The company reported a total revenue of RMB 6,628 million for Q2 2025, down 11% year-on-year, primarily due to lackluster content performance [7]. - Membership and advertising revenues faced pressure, with a sequential decline of 7% and 4%, respectively, attributed to the same content performance issues [7]. - The report anticipates a rebound in Q3 2025, with expected increases in membership and advertising revenues of 3% and 5%, respectively, driven by the success of summer content [7]. Market Performance - The stock has shown a year-to-date increase of 14.43%, with a 52-week high of $3.19 and a low of $1.53 [6]. - The average trading volume is reported at 46.81 million shares [6]. Financial Data Summary - The company is projected to have a net profit of RMB 507 million in 2025, with a gradual increase expected in subsequent years [28]. - The operating profit margin is expected to be 3% in 2025, with improvements anticipated in the following years [3][28].